Mondo Mazwai: "The 2005 Leniency Policy has been a Successful Tool for Cartel Detection"

LEADERS LEAGUE. Could you describe your background in a few words?

Mondo Mazwai. I was born and raised in Johannesburg. Growing up in Apartheid South Africa, I aspired to living in an inclusive society. I believed law was an instrument to this end. After studying law, I joined a firm specializing in human rights law in 1995 and joined the Competition Commission at its inception in 1999 to further my public interest law interest in a more corporate oriented field. I was with the commission until 2005 in various capacities, including as chief legal counsel and acting deputy commissioner. I then joined the private sector in 2005 and was head of the competition law practice at Cliffe Dekker Hofmeyr from 2006 to 2011. Following a sabbatical in 2012, I joined the Competition Tribunal in 2013.

Could you describe the organization of the court?

The Competition Tribunal is one of a trio of competition law enforcement agencies. The commission acts as the prosecutor in the system. The tribunal acts like a court and the Competition Appeal Court hears appeals or reviews against tribunal decisions. Any decision by the Competition Appeal Court can be taken to the Constitutional Court on
appeal.

What are the major changes you have observed in competition law in South Africa since the beginning of your career?

One of the challenges was setting up the institutions and building capacity at inception in 1999. This was developed through on-the-job learning as well as through capacity building arrangements with the US and European authorities, who seconded lawyers and economists to the commission. About five years on, the focus turned to prohibited practices. Without a leniency policy, cartels proved difficult to prosecute. The leniency policy was introduced in 2005 and has been a successful tool for cartel detection. Abuse of dominance cases have been especially difficult to pursue. This has been partly due to the complexity of the economic analysis required in abuse cases; and partly due to different interpretations between the competition agencies and the courts. In February of this year, the act was amended inter alia to strengthen and address some of the challenges regarding abuse cases.

Excessive pricing has been redefined and the price discrimination provision has been strengthened. A new buyer-power provision has been introduced. In some instances, the onus is on the dominant firm to show that it has not abused its position. Going forward, we expect challenges to come from the interpretation of the new amendments to the act. In South Africa there are three independent institutions established to enforce competition law in the territory, those being the Competition Commission, the Competition Tribunal, the Competition Appeal Court. The tribunal notably has authority to adjudicate on matters referred to it by the Commission. We met Mondo Mazwai, chairperson of the tribunal, who agreed to share her deep knowledge of the competition
law system in South Africa.

And in the world in general?

Digital markets are changing the way business is done in a way which has implications for competition law enforcement. We are now figuring out how the market is defined, and how dominance is determined in this context.

What do you think of the European competition policy introduced against GAFA by Margarete Vestager?

I think the policy is a good effort in responding to the complexity of digital markets. Rather than seeking new laws, it deepens the understanding of the theories of harm in these two-sided markets. On the one hand it recognizes the benefits to the consumer brought about through innovations from the likes of Uber and Airbnb. On the other hand, it is alive to the market power gained from the harvesting of personal data and how that might compromise consumer welfare and create barriers to competing services.

How might South Africa improve its own competition policy in the near future?

The most recent amendments to the act seek to tackle the persistently high levels of concentra-tion in the South African economy. The most notable are public interest issues to promote inclusivity in the economy, while merger provisions have been amended to include a consideration of creeping mergers, cross-shareholdings by the merging firms and ownership by workers. While this may introduce regulatory uncertainty, I believe that the rigor of our system will yield the right balance. South Africa has a deep pool of legal expertise, our hearings are public, and our decisions can be appealed. Our role as the tribunal is to interpret the law in a clear, consistent and predictable way so as to encourage large businesses to invest while enabling small businesses to participate in the economy.